Govt moves to sell 42% stake in Indosat

Govt moves to sell 42% stake in Indosat

The Jakarta Post, Jakarta

Moving in accordance with its privatization drive, the
government said Thursday it had planned to sell an almost 42
percent stake in state-owned telecommunications firm PT Indosat
through a strategic sale.

The government said, in a release, it had named state-owned
brokerage firm PT Danareksa Sekuritas and Credit Suisse First
Boston (Singapore) Ltd. as financial advisers for the sale.

This should reaffirm earlier statements by State Minister of
State Enterprises Laksamana Sukardi expressing optimism over
reaching this year's privatization proceeds target of around Rp
3.9 trillion (US$438 million).

The release did not disclose how much profit the government
could expect from the sale, but it would be a considerable sum of
money, serving as a last-ditch effort to meeting the
privatization target.

The publicly-listed Indosat is one of the five state-owned
enterprises (SOEs) in which stakes are to be sold in the second
semester of this year to meet the privatization target.

Rejections from various parties, usually with vested
interests, has led to disappointment in terms of executing the
planned privatization program.

So far, the government has only managed to raise around Rp
2.26 trillion in privatization proceeds. Worse still, the poor
record had forced the government to revise down its target to Rp
3.9 trillion from the initial target of Rp 6.5 trillion.

Given its wide-ranging network, the government is pinning its
hopes on Indosat to contribute the lion's share of the remaining
proceeds.

The government, which previously had 65 percent of Indosat, in
May sold an 8.1 percent stake for $110 million. There are a total
of 1.04 billion Indosat shares.

As stated in the press release, potential investors must have
a minimum of $450 million in total assets, as well as proven
experience in the industry.